news TSMC triples Arizona chip investment to $40bn

Taiwan Semiconductor Manufacturing Company will more than triple its investment in the US state of Arizona to $40bn, as the world's largest contract chipmaker steps up

diversification of its production facilities on geopolitical tensions and pressure from customers.TSMC is investing $12bn into construction of a fabrication plant, or “fab”, in

Arizona designed to make chips with notional 5 nanometer circuit widths — the so-called N5 generation, which will have fallen behind the most advanced type by the time the fab

opens in 2024.However, at an event on Tuesday marking the installation of the first chip tools at the Phoenix plant, the company announced plans for a second fab that will

manufacture more advanced 3nm, or N3 chips, from 2026.TSMC also said that it intends to make N4 chips, a slightly more advanced level, in the fab originally intended for the N5

version.US president Joe Biden and Apple chief executive Tim Cook hailed the expansion, one of the largest foreign direct investments in US history, as a watershed moment in the

country's ability to produce advanced chips domestically.But industry experts said even with a second fab TSMC would not supply chips for new iPhone models locally when the plants

finally open. They added the investments could provide only minimal supply chain security, giving a stark reminder of the risks incurred if China attacked Taiwan — where TSMC is

headquartered and continues the bulk of its expansion.Cook called TSMC's investment “an incredibly significant moment” that would help “create high-tech American jobs — the

jobs of the future”.Apple relies on TSMC as the sole manufacturer of chips used in iPhones, and since it moved on from Intel in 2020, the Silicon Valley group has been using its

own-designed chips produced by TSMC in its laptops and desktop computers.“It's the chance for the United States to usher in a new era in advanced manufacturing,” Cook

said.Biden said the TSMC investment was a “game-changer” that would help America rebuild its capacity to produce advanced chips domestically. “The United States is better

positioned than any other nation to lead the world economy in the years ahead. . . We're seeing it here at home, and investments like what we're talking about today,” he said

after touring the site for the new fab.The move by TSMC follows the passage this summer of Biden's Chips and Science Act, which provides $52bn in subsidies for chipmakers based in

the US, countering China's massive investments in its own chip sector.TSMC has been moving to expand its international footprint, with a new Japanese fab planned for 2024.However,